Anyone who took a high-speed train from Beijing to Shanghai over the past decade might have caught on to this phenomenon. The number of cities built in the middle of nowhere, with concrete skyscrapers standing empty, is stark and staggering. Seeing them is not only surreal, but gives one the sense of seeing something they ought not to, despite it being right outside the window.
The only rationalization that withstands any cursory scrutiny is to think that those towers are the seeds of, say, another Zhengzhou, which more than doubled in population (1.1 to 2.3m people) from 1990 to 2000, then added another 1.2m people from 2000-2010, then added another 1.7m people from 2010-2020 [0].
But then: who will work the 10% of China's land that's arable to feed 1.4B people? And what kind of family will those who came of age during the 1 child policy have in a cramped city? Finally, how the hell is China paying for any of this?
Add it all up, and you get what this article is talking about: a zombie economy, dependent on a crumbling world order, surrounded by countries that hold millennia-old grudges against it. Plus Russia.
> who will work the 10% of China's land that's arable to feed 1.4B people?
According to the US Department of Agriculture [1], in the US
"Direct on-farm employment accounted for about 2.6 million of these jobs, or 1.3 percent of U.S. employment"
China is not as advanced as the US, but even if the productivity is lower by a factor of 5, you could end up with only 6.5% of the working population being employed on farms. The Chinese workforce is 733 million people, so you'd need to have less than 50 million employed on farms.
>rationalization that withstands any cursory scrutiny
I mean yeah, that's the rationalisation, that useful idiots deliberately try not to see. PRC currently @65% urbanzation, with goal of 75-80% by 2035, aka 140-200M people. PRC "only" has 50M empty flats. Having excess housing inventory is fine, it's inefficient, but no more inefficient that US health sector at 20% GDP with medicore life expectancy. Which is only a light dig as US, but mostly to show that it's not big deal in the grand scheme of things.
>who will work the 10% of China's land that's arable to feed 1.4B people
PRC has 200M farming housholds when it really only needs 10M farmers using advanced ag equipment. There's stupid oversupply of agriculture labour, by design because it's a nice make job program for rural poor and consolidating agriculture is touchy subject because land reforms central to CCP founding mythos. Like out of all the concerns, lack of ag labour is most trivial.
>paying for any of this
With modest debt. PRC national debt is ~75% of GDP vs US ~120%, total aggregate debt PRC ~270% vs US ~760%. Basically +40-50% in the last 10 years to fund the largest infra expansion in human history. Pretty cheap all things considered.
>a zombie economy
1. @5% growth, if PRC is where JP is in 80s, that's 500% larger economy by 00s. If PRC is zombie economy, everyone else is stone dead.
> dependent on a crumbling world order,
2. PRC's is globalizing, see PRC increasing trade by 1T in last 4 years, more than previous 10, greatest increase in globalism in human history.
> surrounded by countries that hold millennia-old grudges against it.
3. Small countries where even with US basing, military force balance is trending towards PRC favor with each passing year.
>Plus Russia.
4. Guaranteed cheap gas and agri.
TLDR if PRC last few years is zombie, than momentum of PRC zombie horde will win like in most zombie media.
China has only 10% of the world's arable land yet produces a quarter of the global grain output and leads the planet in the production of cereals, cotton, fruit, vegetables, meat, poultry, eggs, and fishery products, according to FAO. [0]
China is more than 100% self sufficient on essential food (rice and other grains). China does import a large amount of soybean for fodder. If anything, I think Chinese eat too much nowadys and become as wasteful in food as Americans. When I visit China, I don't like the fact that many families have pets (dog, cat, and etc) just like here in US.
Are there no mechanization gains in China to increase ag production per worker? In the short term they're already net importers of food, no reason this can't continue until their population collapses via impacts of 1 child.
“ In its closed financial system, exporters must surrender their foreign earnings to the central bank, which creates equivalent RMB to mop up the foreign currencies. This led to the rapid expansion of RMB liquidity in the economy, mostly in the form of bank loans. ”
Can anyone explain this to me? My interpretation is the central bank exchanges exporter’s foreign currency for RMB. How does it become bank loans?
My understanding: business A sells USD 1,000 worth of goods abroad.
Customer wires USD 1,000 to bank B to the account of business A as payment for the goods.
This money does not go directly to the account of business A.
Bank B sends USD 1,000 to Central bank and gets RMB 7,000 (or whatever the exchange rate is) which go to the account of business A.
Bank B ends up with deposits almost entirely in RMB to loan out. Few customers outside China really want those.
Compare with a situation in which bank B kept its USD on the books as customer deposits. Then it would have USD to loan out, and the market for such loans is much bigger.
If it's like Russia, maybe you get paid in bucks but you pretty much must convert them all to RMB immediately. So the bank needs to create all that RMB for all the exporters. Part of it circles back in taxes and stuff. Assuming exporters can't or don't want to spend all that RMB immediately there's now a bunch of RMB in country in some shape or form. A lot probably in banks.
Funny, I was looking at the second half of that paragraph so will post it here:
Because the banking system is tightly controlled by the party-state – with state-owned or state-connected enterprises serving as the fiefdoms and cash cows of elite families – the state sector enjoyed privileged access to state bank loans, which were used to fuel an investment spree. The result was rising employment, a temporary and localized economic boom, and a windfall for the elite. But this dynamic also left behind redundant and unprofitable construction projects: empty apartments, underused airports, excessive coal plants and steel mills. That, in turn, resulted in falling profits, slowing growth and worsening indebtedness across the main sectors of the economy.
Which looks eerily similar to the influx of outside capital in cities like mine, which are experiencing unprecedented growth as huge apartment complexes are built for millions of dollars, while the average person can't afford a $500,000 home that was just $150,000 a decade ago. Because access to capital has been ..corrupted? I don't know the right word.
So we have all of these people working as hard as they can to build nonproductive infrastructure. A healthier investment might look like NOT paving farms. Or expanding mass transit. Or funding education. Or stimulating the commercial and industrial sectors. Or doing anything else at all really.
We already went down this road in the 2000s, when the Dot Bomb strategically crashed the economy to give Bush the win in the Bush v. Gore decision, so that attention could be distracted away from sustainability investments like electric cars and solar, towards militarism and a buildout of the housing market which led to the housing bubble popping in 2008. IMHO the US never recovered from that, so now it's all these shell games designed to keep capital out of the hands of everyday working people, who will be left behind as we transition to a rent-based economy of global neofeudalism.
Beneficiaries are not the ones paying in with their time and effort, which creates low morale in the economy and causes the 20% unemployment in youth who have rightfully spotted that the economy is rigged. I think this will become more prevalent as authoritarianism rises and AI eventually takes an oversight role while having no accountability.
BTW this is all fixed through tax policy. We simply tax the wealthy at post-WWII levels until the national debt is paid and workers return to a livable wage as the middle class grows. Note that that's the only thing we haven't tried, which is why no progress is being made.
I would encourage commenters here to pay a visit to China to see what's happening there with their own eyes. Most commenters never visit China and make some bold comments based on distorted information from MSM. A couple of months ago, I visited my hometown in China, located in one of the poorest regions of the country, and I witnessed how vibrant the local economy is. I attended a Big Data Expo held there, and I was shocked by how deep Big Data and AI are integrated in everyday life and industry over there. I think it's beneficial to know the facts in seeking truth.
you'd think Western economists and enlightened HN readers might have even a single moment of introspection after being consistently wrong about China for years
but I suppose the perpetual condescending and underestimating is preferable to the typical violent modus operandi
China seems to have some serious structural problems that are impeding its rise. For instance it has been reported that negative outlooks by economists are now to be censored, and "deflation" is a bad word.[0] It would be better for everyone if China fixes the issues with its economy so we can go back to cooperatively creating wealth for the world.
"Information is antifragile; it feeds more on attempts to harm it than it does on efforts to promote it."[1]
Question.
For 20 years I've been hearing China will takeover, and also that it is about to collapse.
It seems like daily there is some story about how China will collapse, and then also stories of how it will still takeover.
I did read it, but not seeing what this article brings new.
What is the point being made here? Except, things are bad, and nobody realizes it.
The term Zombie Economy has been used for a lot of years, when will it actually manifest?
Both ends (takeover / collapse) are exaggerations for the benefit (attention) of the person making the claim.
The US and EU/Eurozone/Western Europe are not going away. Their significant allies are not going away (eg Japan, South Korea, Australia, New Zealand, India, etc.). China isn't taking over, they're becoming (have become) a peer global power.
China has accumulated vast wealth, infrastructure, manufacturing, know-how, and so on. It's not going to reverse backwards in the sense of collapse. Things aren't going back to the way they were 30-40 years ago. China is - at least for our relevant time - permanently established as a free-standing power (ie even if the West wanted to, that genie can't be put back). They will likely continue to progress, even if at a slower pace.
Stagnation brought on by hyper rigid authoritarianism is most likely. At least during the Xi era. Perhaps there will be a Deng Xiaoping like loosening again afterward, who knows (maybe someone far worse will use Xi's levers of power to implement even stricter authoritarianism).
My impression has been that this looks simply like the result of an extemely rapidly changing economy and economic framework and government. The rules change frequently. In an ad-hoc manner. Even when it seems there are a lot of people working behind all these rule changes - both on the theory and the applicability. So yes of course there is a lot of waste and randomly propped up systems and temporary fixes. And then that's even if we want to argue that say US systems are really built for the long term... which is problematic also with a total willingness to change the rules from one day to the next but nowhere near to the level of China.
Good luck running long term businesses (but some people seem to manage pretty well - survivor bias?) and long term personal or family investments (scary just a bit? - I mean beyond US-style investing?)
>The term Zombie Economy has been used for a lot of years, when will it actually manifest?
Around 30% of the economy is linked to real estate, seems pretty zombified. Export economy is being strangled by increased labour costs/shortages and carefully rolled sanctions. Consumption economy has difficulties to grow due to a lack of "hope in better times" from consumers. But the elephant in the room is the CCP, which is looking more concerned with "political stability" at the expense of everything else.
Things are bad since Xi Jimping first years with first wave of delocalization of
(textile) industries, politicization of society, political infightings that target the economy, etc...
You have been hearing predictions about what might happen to China in the future for 20 years, if the nation grows too quickly in the wrong ways and doesn't solve it's impending demographic problems.
The article is saying 'China peaked in 2021 and the past two years have been a zombie economy'. It's not talking about what might happen, but about what has already happened and why the state has been hyper-focusing on security and military competition with the west for the last couple of years.
Clickbaity title. The article is not bad, but he doesn't explain why the declining growth rate is "the logical outcome of China’s uneven development and capital accumulation over the last four decades."
I'm still not sold on the "China is dying" theory. China's GDP per capita is the same as Japan's when it entered single digit growth in 1970.[0][1] Those numbers surprised me, though, and may be too low wrt Japan. I think the aging demographic is a greater issue than the ones listed in the OP; economic activity can always be restarted given the underlying conditions are there, which is the case for China in general in my opinion. Demography is destiny, however, and cannot be escaped. The One Child Policy was a mistake for the economy.
The Economist recently did some interesting rethinking of the unstoppable power of the Chinese economy in their May "Peak China?" edition. Some links (sorry for paywall, but I do find them worth it.) https://www.economist.com/weeklyedition/2023-05-13
In short, they do have a number of functional problems keeping them from further growth. Chief among them is a lack of local resources. They must rely on importing base materials in order to have value added goods to export. Plus some indications that just because their government wants to grow their people may not have such a strong desire. They have something like 34 million more males than females. Also growing signs of toxic financial conditions in their real estate markets including fraud and abuse ("How to escape China's property crisis" https://www.economist.com/finance-and-economics/2023/06/28/h... and "China’s economic recovery is spluttering. The prognosis is not good" https://www.economist.com/leaders/2023/06/22/chinas-economic... , etc)
It’s bad. Many debt slaves were created in the recent mortgage and housing crisis, and a lot of workers are furious and apathetic working these long hours for little to no pay.
>But many enterprises simply took advantage of easy bank loans to refinance their existing debt without adding new spending or investment to the economy. These companies eventually became loan addicts; and as with any addiction, increasing doses were needed to generate diminishing effects.
Sounds like a description of the Western economic situation to me.
The American economy is growing in real terms, with inflation a continuing risk. Beijing is “putting pressure on prominent local economists to avoid discussing negative trends such as deflation” [1]. These are opposite problems.
We are also in a high-rate environment that is leading to defaults in the property sector [2]. Again, the opposite of extend and pretend.
It's so tiresome how much of popular geopolitical/macro "analysis" is literally just a linear extrapolation of surface metrics. Almost zero understanding of underlying trends and agendas and how new technology (renewable energy, automation) will disrupt.
Growth went from 10% to 5%, therefore it is basically 0% if not negative.
Birthrates are down, therefore total demographic collapse is imminent.
Some real estate projects failed, therefore all real estate is about to crash.
So much noise. But hey, the Strategic Competition Act of 2021 earmarked hundreds of millions of dollars for producing such nonsense.
>The Economist projected that China would become the world’s biggest economy by 2018, surpassing the United States.
What annoys me about economists is how often they redefine how they calculate things like "GDP" and "unemployment" and then try to compare their new oranges to their old data apples.
In many respects, if you use the older metrics China has long surpassed America on its GDP output but with the constant revision America still is "number 1".
Same goes for unemployment. You can compare these metrics when you change how they're calculated.
As for China, their youth is now experiencing what many in the West and Japan are familiar with: NEETs/hikkimori.
They don't see the point in working because the cost of living is too high and their wages stagnant so they go the opposite route and do just enough to get by and enjoy life.
> In many respects, if you use the older metrics China has long surpassed America on its GDP output
Which older metrics are you specifically using to support that claim and can you show me what China's GDP figure looks like compared to the US under that different model?
We don’t have real numbers from China to know what their GDP is. There’s theories it could be negative right now which coincides with their housing crisis, huge local debts due to covid, huge cost of living and due to covid less spending which results in less jobs, the world pulling out of China. Etc. any positive numbers would surely be made up, one CCP official already admitted to the numbers being fudged.
Well there is GDP PPP and nominal and metrics never changed. China has surpassed U.S. in PPP GDP around 2017 and might at some far away future point around it's historical peak (10-20 years away), get up to 2x the U.S. level, but it might never reach U.S. nominal level (currently 67% of it), or if it does, only briefly and marginally so.
None of those metrics has "changed". It's just two different ways of measuring it: PPP defines intrinsic economic power/amount of goods consumed, nominal defines power on world markets/purchasing ability. We produce and consume in national prices that are different (and PPP factor corrects for that difference), but we trade in nominal dollars.
>In many respects, if you use the older metrics China has long surpassed America on its GDP output but with the constant revision America still is "number 1".
Can you elaborate on this? What are the "older metrics" in question?
>Same goes for unemployment. You can compare these metrics when you change how they're calculated.
Is the 20% figure cited in the article somehow not comparable to other figures in the G-7?
> In many respects, if you use the older metrics China has long surpassed America on its GDP output but with the constant revision America still is "number 1".
Maybe, but the Economist is a UK publication. What incentive would they have to prop up the identity of America as number 1?
[+] [-] isykt|2 years ago|reply
The only rationalization that withstands any cursory scrutiny is to think that those towers are the seeds of, say, another Zhengzhou, which more than doubled in population (1.1 to 2.3m people) from 1990 to 2000, then added another 1.2m people from 2000-2010, then added another 1.7m people from 2010-2020 [0].
But then: who will work the 10% of China's land that's arable to feed 1.4B people? And what kind of family will those who came of age during the 1 child policy have in a cramped city? Finally, how the hell is China paying for any of this?
Add it all up, and you get what this article is talking about: a zombie economy, dependent on a crumbling world order, surrounded by countries that hold millennia-old grudges against it. Plus Russia.
Yikes.
[0]https://worldpopulationreview.com/world-cities/zhengzhou-pop...
[+] [-] credit_guy|2 years ago|reply
According to the US Department of Agriculture [1], in the US
China is not as advanced as the US, but even if the productivity is lower by a factor of 5, you could end up with only 6.5% of the working population being employed on farms. The Chinese workforce is 733 million people, so you'd need to have less than 50 million employed on farms.[1] https://www.ers.usda.gov/data-products/ag-and-food-statistic...
[+] [-] dirtyid|2 years ago|reply
I mean yeah, that's the rationalisation, that useful idiots deliberately try not to see. PRC currently @65% urbanzation, with goal of 75-80% by 2035, aka 140-200M people. PRC "only" has 50M empty flats. Having excess housing inventory is fine, it's inefficient, but no more inefficient that US health sector at 20% GDP with medicore life expectancy. Which is only a light dig as US, but mostly to show that it's not big deal in the grand scheme of things.
>who will work the 10% of China's land that's arable to feed 1.4B people
PRC has 200M farming housholds when it really only needs 10M farmers using advanced ag equipment. There's stupid oversupply of agriculture labour, by design because it's a nice make job program for rural poor and consolidating agriculture is touchy subject because land reforms central to CCP founding mythos. Like out of all the concerns, lack of ag labour is most trivial.
>paying for any of this
With modest debt. PRC national debt is ~75% of GDP vs US ~120%, total aggregate debt PRC ~270% vs US ~760%. Basically +40-50% in the last 10 years to fund the largest infra expansion in human history. Pretty cheap all things considered.
>a zombie economy
1. @5% growth, if PRC is where JP is in 80s, that's 500% larger economy by 00s. If PRC is zombie economy, everyone else is stone dead.
> dependent on a crumbling world order,
2. PRC's is globalizing, see PRC increasing trade by 1T in last 4 years, more than previous 10, greatest increase in globalism in human history.
> surrounded by countries that hold millennia-old grudges against it.
3. Small countries where even with US basing, military force balance is trending towards PRC favor with each passing year.
>Plus Russia.
4. Guaranteed cheap gas and agri.
TLDR if PRC last few years is zombie, than momentum of PRC zombie horde will win like in most zombie media.
[+] [-] datumy|2 years ago|reply
China is more than 100% self sufficient on essential food (rice and other grains). China does import a large amount of soybean for fodder. If anything, I think Chinese eat too much nowadys and become as wasteful in food as Americans. When I visit China, I don't like the fact that many families have pets (dog, cat, and etc) just like here in US.
[0]https://www.fao.org/china/fao-in-china/china-at-a-glance/en
[+] [-] piyh|2 years ago|reply
[+] [-] naveen99|2 years ago|reply
[+] [-] lamontcg|2 years ago|reply
zombie economy based on cheap debt?
good thing the US doesn't have any of that.
[+] [-] jimbursch1|2 years ago|reply
Can anyone explain this to me? My interpretation is the central bank exchanges exporter’s foreign currency for RMB. How does it become bank loans?
[+] [-] yafbum|2 years ago|reply
Customer wires USD 1,000 to bank B to the account of business A as payment for the goods.
This money does not go directly to the account of business A.
Bank B sends USD 1,000 to Central bank and gets RMB 7,000 (or whatever the exchange rate is) which go to the account of business A.
Bank B ends up with deposits almost entirely in RMB to loan out. Few customers outside China really want those.
Compare with a situation in which bank B kept its USD on the books as customer deposits. Then it would have USD to loan out, and the market for such loans is much bigger.
[+] [-] throwaway290|2 years ago|reply
[+] [-] zackmorris|2 years ago|reply
Because the banking system is tightly controlled by the party-state – with state-owned or state-connected enterprises serving as the fiefdoms and cash cows of elite families – the state sector enjoyed privileged access to state bank loans, which were used to fuel an investment spree. The result was rising employment, a temporary and localized economic boom, and a windfall for the elite. But this dynamic also left behind redundant and unprofitable construction projects: empty apartments, underused airports, excessive coal plants and steel mills. That, in turn, resulted in falling profits, slowing growth and worsening indebtedness across the main sectors of the economy.
Which looks eerily similar to the influx of outside capital in cities like mine, which are experiencing unprecedented growth as huge apartment complexes are built for millions of dollars, while the average person can't afford a $500,000 home that was just $150,000 a decade ago. Because access to capital has been ..corrupted? I don't know the right word.
So we have all of these people working as hard as they can to build nonproductive infrastructure. A healthier investment might look like NOT paving farms. Or expanding mass transit. Or funding education. Or stimulating the commercial and industrial sectors. Or doing anything else at all really.
We already went down this road in the 2000s, when the Dot Bomb strategically crashed the economy to give Bush the win in the Bush v. Gore decision, so that attention could be distracted away from sustainability investments like electric cars and solar, towards militarism and a buildout of the housing market which led to the housing bubble popping in 2008. IMHO the US never recovered from that, so now it's all these shell games designed to keep capital out of the hands of everyday working people, who will be left behind as we transition to a rent-based economy of global neofeudalism.
Beneficiaries are not the ones paying in with their time and effort, which creates low morale in the economy and causes the 20% unemployment in youth who have rightfully spotted that the economy is rigged. I think this will become more prevalent as authoritarianism rises and AI eventually takes an oversight role while having no accountability.
BTW this is all fixed through tax policy. We simply tax the wealthy at post-WWII levels until the national debt is paid and workers return to a livable wage as the middle class grows. Note that that's the only thing we haven't tried, which is why no progress is being made.
[+] [-] typon|2 years ago|reply
[+] [-] datumy|2 years ago|reply
[+] [-] bllguo|2 years ago|reply
but I suppose the perpetual condescending and underestimating is preferable to the typical violent modus operandi
[+] [-] ipnon|2 years ago|reply
"Information is antifragile; it feeds more on attempts to harm it than it does on efforts to promote it."[1]
[0] https://www.ft.com/content/b2e0ad77-3521-4da9-8120-1f0c1fdd9...
[1] https://libquotes.com/nassim-nicholas-taleb/works/antifragil...
[+] [-] nonethewiser|2 years ago|reply
[+] [-] FrustratedMonky|2 years ago|reply
I did read it, but not seeing what this article brings new.
What is the point being made here? Except, things are bad, and nobody realizes it.
The term Zombie Economy has been used for a lot of years, when will it actually manifest?
[+] [-] adventured|2 years ago|reply
The US and EU/Eurozone/Western Europe are not going away. Their significant allies are not going away (eg Japan, South Korea, Australia, New Zealand, India, etc.). China isn't taking over, they're becoming (have become) a peer global power.
China has accumulated vast wealth, infrastructure, manufacturing, know-how, and so on. It's not going to reverse backwards in the sense of collapse. Things aren't going back to the way they were 30-40 years ago. China is - at least for our relevant time - permanently established as a free-standing power (ie even if the West wanted to, that genie can't be put back). They will likely continue to progress, even if at a slower pace.
Stagnation brought on by hyper rigid authoritarianism is most likely. At least during the Xi era. Perhaps there will be a Deng Xiaoping like loosening again afterward, who knows (maybe someone far worse will use Xi's levers of power to implement even stricter authoritarianism).
[+] [-] creer|2 years ago|reply
Good luck running long term businesses (but some people seem to manage pretty well - survivor bias?) and long term personal or family investments (scary just a bit? - I mean beyond US-style investing?)
[+] [-] kwere|2 years ago|reply
Around 30% of the economy is linked to real estate, seems pretty zombified. Export economy is being strangled by increased labour costs/shortages and carefully rolled sanctions. Consumption economy has difficulties to grow due to a lack of "hope in better times" from consumers. But the elephant in the room is the CCP, which is looking more concerned with "political stability" at the expense of everything else.
Things are bad since Xi Jimping first years with first wave of delocalization of (textile) industries, politicization of society, political infightings that target the economy, etc...
[+] [-] SkyMarshal|2 years ago|reply
[+] [-] trailingComma|2 years ago|reply
The article is saying 'China peaked in 2021 and the past two years have been a zombie economy'. It's not talking about what might happen, but about what has already happened and why the state has been hyper-focusing on security and military competition with the west for the last couple of years.
[+] [-] makotech221|2 years ago|reply
[deleted]
[+] [-] Vt71fcAqt7|2 years ago|reply
I'm still not sold on the "China is dying" theory. China's GDP per capita is the same as Japan's when it entered single digit growth in 1970.[0][1] Those numbers surprised me, though, and may be too low wrt Japan. I think the aging demographic is a greater issue than the ones listed in the OP; economic activity can always be restarted given the underlying conditions are there, which is the case for China in general in my opinion. Demography is destiny, however, and cannot be escaped. The One Child Policy was a mistake for the economy.
[0]https://data.worldbank.org/indicator/NY.GDP.PCAP.KD.ZG?locat...
[1]https://data.worldbank.org/indicator/NY.GDP.PCAP.KD?location...
[+] [-] ianai|2 years ago|reply
Is Chinese power about to peak? : https://www.economist.com/leaders/2023/05/11/is-chinese-powe...
How soon and at what height will China’s economy peak? : https://www.economist.com/briefing/2023/05/11/how-soon-and-a...
How China measures national power : https://www.economist.com/briefing/2023/05/11/how-china-meas...
The fall of empires preys on Xi Jinping’s mind : https://www.economist.com/briefing/2023/05/11/the-fall-of-em...
In short, they do have a number of functional problems keeping them from further growth. Chief among them is a lack of local resources. They must rely on importing base materials in order to have value added goods to export. Plus some indications that just because their government wants to grow their people may not have such a strong desire. They have something like 34 million more males than females. Also growing signs of toxic financial conditions in their real estate markets including fraud and abuse ("How to escape China's property crisis" https://www.economist.com/finance-and-economics/2023/06/28/h... and "China’s economic recovery is spluttering. The prognosis is not good" https://www.economist.com/leaders/2023/06/22/chinas-economic... , etc)
[+] [-] christkv|2 years ago|reply
[+] [-] ddggdd|2 years ago|reply
[+] [-] xwdv|2 years ago|reply
[+] [-] kwere|2 years ago|reply
[+] [-] noselasd|2 years ago|reply
[+] [-] bothSidez|2 years ago|reply
[deleted]
[+] [-] aaron695|2 years ago|reply
That's considered to be low.
Predictions for the US's 2023 GDP growth is 1.6%
They seem to think a pandemic where Chinas response was total lockdown is indictive of the future.
> The Economist now claims that China might never catch up with the US
That's not how The Economist works
[+] [-] esotericimpl|2 years ago|reply
[deleted]
[+] [-] seruda|2 years ago|reply
[deleted]
[+] [-] 74729472616284|2 years ago|reply
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[+] [-] billtsedong|2 years ago|reply
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[+] [-] fuoqi|2 years ago|reply
Sounds like a description of the Western economic situation to me.
[+] [-] JumpCrisscross|2 years ago|reply
We are also in a high-rate environment that is leading to defaults in the property sector [2]. Again, the opposite of extend and pretend.
[1] https://www.ft.com/content/b2e0ad77-3521-4da9-8120-1f0c1fdd9...
[2] https://commercialobserver.com/2023/03/default-floor-brookfi...
[+] [-] gsatic|2 years ago|reply
[+] [-] zukzuk|2 years ago|reply
[+] [-] worrycue|2 years ago|reply
How so?
[+] [-] steve76|2 years ago|reply
[deleted]
[+] [-] pphysch|2 years ago|reply
Growth went from 10% to 5%, therefore it is basically 0% if not negative.
Birthrates are down, therefore total demographic collapse is imminent.
Some real estate projects failed, therefore all real estate is about to crash.
So much noise. But hey, the Strategic Competition Act of 2021 earmarked hundreds of millions of dollars for producing such nonsense.
[+] [-] freitzkriesler2|2 years ago|reply
What annoys me about economists is how often they redefine how they calculate things like "GDP" and "unemployment" and then try to compare their new oranges to their old data apples.
In many respects, if you use the older metrics China has long surpassed America on its GDP output but with the constant revision America still is "number 1".
Same goes for unemployment. You can compare these metrics when you change how they're calculated.
As for China, their youth is now experiencing what many in the West and Japan are familiar with: NEETs/hikkimori.
They don't see the point in working because the cost of living is too high and their wages stagnant so they go the opposite route and do just enough to get by and enjoy life.
I don't blame them either.
[+] [-] adventured|2 years ago|reply
Which older metrics are you specifically using to support that claim and can you show me what China's GDP figure looks like compared to the US under that different model?
[+] [-] throwaway2990|2 years ago|reply
[+] [-] anovikov|2 years ago|reply
None of those metrics has "changed". It's just two different ways of measuring it: PPP defines intrinsic economic power/amount of goods consumed, nominal defines power on world markets/purchasing ability. We produce and consume in national prices that are different (and PPP factor corrects for that difference), but we trade in nominal dollars.
[+] [-] gruez|2 years ago|reply
Can you elaborate on this? What are the "older metrics" in question?
>Same goes for unemployment. You can compare these metrics when you change how they're calculated.
Is the 20% figure cited in the article somehow not comparable to other figures in the G-7?
[+] [-] eatonphil|2 years ago|reply
Maybe, but the Economist is a UK publication. What incentive would they have to prop up the identity of America as number 1?